According to media reports, India has surpassed China as Sri Lanka’s top bilateral lender, with a total of $968 million in loans in the first four months of 2022. China has been the top bilateral lender to Sri Lanka for the past five years, from 2017 to 2021, disbursing $947 million, $809 million of which was received as market borrowings from the China Development Bank, according to the Daily Financial Times (FT).
It stated that the Asian Development Bank (ADB) had been the leading multilateral lender during the last five years, with financing totalling $610 million disbursed in 2021.
According to the Daily FT, India has disbursed $377 million, and ADB has disbursed $360 million, accounting for 76% of total disbursements in the first four months of 2022.
Meanwhile, during the United Nations General Assembly’s Annual Joint Debate on the Reports of the Peacebuilding Commission (PBC) and the Peacebuilding Fund (PBF), India’s Permanent Representative to the UN, Ruchira Kamboj, stated that India had provided nearly $4 billion in food and financial assistance to Sri Lanka.
Kamboj said, “In our immediate neighbourhood, we are continuing to help our good friend and neighbour Sri Lanka to ensure food security by providing nearly USD 4 billion in food and financial assistance during the past few months.”
On August 22, India delivered 21,000 tonnes of fertilizer to crisis-torn Sri Lanka.
The High Commission of India in Colombo tweeted, “Adding to the fragrance of friendship and cooperation. High commissioner formally handed over 21,000 tonnes of fertilizer supplied under India’s special support to the people of Sri Lanka.”
It tweeted, “This follows 44,000 tonnes supplied last month under Indian support totalling about $4 billion in 2022. The fertilizer will contribute to food security and support the farmers of Sri Lanka. It demonstrates benefits to the people from close ties with #India and mutual trust and goodwill between #India and #Sri Lanka.”
India has been at the forefront of extending financial help to Sri Lanka following their needs and is one of the countries that has supplied the most support in times of need. Sri Lanka has been experiencing an expanding economic crisis since the beginning of 2022, and the government has defaulted on its foreign loans.
Sri Lanka is in a severe economic crisis, with food and fuel scarcity affecting a substantial proportion of the island’s population. Since the start of the Covid-19 outbreak, the economy has been on the free slide.
Sri Lanka is also experiencing a foreign exchange crisis, which has hampered the country’s ability to purchase food and fuel, resulting in power outages. Due to a lack of critical products, Sri Lanka was forced to seek assistance from friendly countries.